August 6, 2020 The Honorable Mitch McConnell The Honorable Charles E. Schumer Speaker Majority Leader Minority Leader Minority Leader U.S. Senate U.S. Senate Washington D.C. 20510 Washington D.C. 20510 The Honorable Marco Rubio The Honorable Ben Cardin Chairman, Committee on Small Business & Ranking Member, Committee on Small Business Entrepreneurship & Entrepreneurship U.S. Senate U.S. Senate Washington D.C. 20510 Washington D.C. 20510 Dear Majority Leader McConnell, Minority Leader Schumer, Chairman Rubio, and Ranking Member Cardin We write to you on behalf of our independent franchise owners regarding recent proposals to further help small businesses like theirs during the COVID-19 pandemic. The undersigned brands represent a broad segment of the franchise sector, which employs roughly 8 million American workers at 733,000 locations. The franchise business model has led to success and upward mobility for both franchise owners and employees in more than 300 business lines and across demographic groups. Indeed, franchising is more diverse than non-franchise businesses: according to U.S. Census data, nearly 30 percent of franchise businesses are minority-owned, compared to 18 percent of non-franchised businesses. Our franchisees truly appreciate your leadership in Congress’s historic response to the COVID-19 crisis. The Paycheck Protection Program (PPP), in conjunction with increased support of our health care system, has enabled many franchise small businesses to remain operational and retain employees. However, the future for these same small businesses is anything but settled. Continuous operation at reduced capacity – and in many cases, extended business closures – has led to precipitous drops in revenue. These revenue drops, when combined with fixed costs of rent, mortgages, insurance, and increased personal protective equipment and sanitation costs, make the unit economics of small business operation a challenge. We are pleased there is consensus that Congress should provide additional relief options to small businesses that need it the most. While we support inclusion of a revenue decline threshold for additional relief, we feel that the 50 percent decline as proposed in the HEALS Act is simply too high. Many small businesses like the ones in our systems operate on slim margins. For them, a revenue decline could mean the difference between staying in business or closing. For their employees, this revenue decline could mean the difference between remaining at work and receiving benefits or joining our nation’s too-high number of unemployed people. For businesses with revenue declines of less than 50 percent – businesses currently excluded from Congress’s proposal – access to a second round of PPP funding, and a new, long-term, low-interest loan program, may prove the lifeline they need to stay afloat throughout the economic recovery. Many of these businesses initially benefited from PPP, but through no fault of their own, remain closed or forced to operate at reduced capacity to protect public safety and health for their employees and customers. This second round of funding and access to these long-term loans is akin to a targeted investment from the federal government into the very businesses where it can make the most difference. As you consider this important emergency funding, it is also important to begin to focus on the long-term recovery. Enhancing the SBA loan programs with higher guarantees and reduction of upfront fees has proven to be an effective tool in other times of economic uncertainty. SBA lending is critically important to our members and enhancements to programs will ensure small businesses have access to the capital they need at a time when conventional may not be available. In addition, extending the Section 1112 loan payment subsidy of the CARES Act is critical to helping businesses that currently have or are obtaining a new SBA loan continue their business and weather the storm. America’s small businesses – franchise or otherwise – have borne a heavy burden during this pandemic. These businesses, which are part of the fabric of so many communities, have worked diligently to serve their customers, employees, and communities in a clean, safe, and compliant manner throughout the pandemic. On behalf of our franchisees, we encourage you to expand access for relief options to ensure that these same small businesses are eligible for the additional assistance they need. Thank you for considering our views. Sincerely, American Family Care, AL The Closet Trading Company, CA American Family Care Urgent Care, AL The Good Feet Store, CA P3 Cost Analysts, AR The UPS Store, Inc., CA Amazing Lash Studio Franchise, AZ True REST Franchising, CA Assisted Living Locators, AZ World Gym International, CA CarePatrol, AZ Yoga Six, CA Daily Jam, AZ KKP, CN Massage Envy Franchising, AZ Metal Supermarkets, CN V's Barbershop, AZ AlphaGraphics, CO Archibald's Drive Thru, CA Frenchies Modern Nail Care, CO Aussie Pet Mobile Inc., CA Payroll Vault Franchising, CO Big Mamas and Papas Pizzeria, CA PostNet International Franchise Corporation, CO Brain Balance Achievement Centers, CA Royal Aloha Franchise Co., CO California Closets, CA Sola Salon Studios, CO COIT Cleaning and Restoration, CA Wayback Burgers, CT Curves International, CA Big Frog Custom T-Shirts, FL Drybar Holdings LLC, CA EventPrep, Inc., FL Franchise Services, Inc., CA HEW fitness, FL Home Care Assistance, CA i9 Sports Corporation, FL MADabolic, CA Nikita Hair, FL Mathnasium Learning Centers, CA OrangeTheory Fitness, FL PIP Printing, CA Paul Davis Restoration, FL Sir Speedy Printing, CA Precision Door Service, FL Stratus Building Solutions, CA PuroClean, FL TeamLogic IT, CA RSVP, FL Signarama, FL Franworth, MI Alloy Wheel Repair Specialists, GA HOODZ International, MI Carvel, GA Hungry Howie's Pizza and Subs Inc., MI Church's Chicken, GA Jabz Franchising, MI Cinnabon, GA LaVida Massage, MI Floor Coverings International, GA Molly Maid, MI Honey Baked Ham Co., GA Mr. Handyman, MI Jamba, GA Sobeck Enterprises,Inc., MI M Squared Franchise Consulting, GA Great Clips, Inc., MN Maid Brigade, GA Haagen-Dazs, MN McAlister's Deli, GA Insty Prints, MN Moe's Southwest Grill, GA KidCreate Studio, MN Pigtails & Crewcuts, GA Miracle-Ear, Inc., MN Schlotzsky's, GA Slumberland Furniture, MN The Coca-Cola Company, GA American Poolplayers Association, MO Workout Anytime Franchising Systems, GA Fish Window Cleaning, MO Your Pie Franchising, GA Hair Saloon, MO Pancheros Mexican Grill, IA BeLocal, NC CD One Price Cleaners, IL Blue Moon Estate Sales, NC Creative Colors International, Inc., IL East Coast Wings + Grill, NC Image One Facililty Solutions, Inc, IL Famous Toastery, NC Pivotal Growth Partners, IL Golden Corral Corporation, NC Spring-Green Law Care, IL N2 Publishing, NC Wild Birds Unlimited, Inc., IN Real Producers, NC Wings Etc., IN The Salt Suite, NC Nextaff, KS Home Instead Senior Care, NE A&W Restaurants, Inc., KY 1Huddle, NJ FranNet, KY Closet & Storage Concepts / More Space Place, AeroWest International, LA NJ Pizza Artista, LA Eye Level Learning Centers, NJ Cheesy Street Grill, MA K9 Resorts, NJ Dunkin' Brands, Inc., MA Lawn Doctor, NJ FIC Restaurants, Inc., MA Lightbridge Academy, NJ Johnny Rockets, MA UCMAS Mental Math Schools, NJ Lapels Dry Cleaning, MA Hampton Coffee Company, NY Image360, MD Home Helpers Home Care, OH Roy Rogers Restaurants, MD Pet Wants Franchise System, OH Sign by Tomorrow, MD Window Genie, OH Signs Now, MD Express Services, Inc., OK Allegra Marketing, MI Elmer's Restaurants, Inc., OR Alliance Franchise Brands, MI Auntie Anne's, PA American Speedy Printing Centers, MI CertaPro Painters, PA At Your Side, MI FirstService Brands, PA Best Life Brands, MI GNC, PA ComForCare, MI Green Home Solutions, PA Detroit Kid City Franchise, MI Painting with a Twist, PA Dryer Vent Wizard, MI Pillar to Post Home Inspectors, PA Rita's Franchise Company, PA Urban Air Adventure Park, TX Soccer Shots, PA Wanna Play Playcare, TX Adventure Kids Playcare, TX Xpressdocs, TX Aire Serv Heating and Air Conditioning, TX Athletic Republic, UT Bumper Man Inc., TX Cookie Cutters Haircuts for Kids, UT Childrens Lighthouse, TX InXpress, UT FASTSIGNS International, TX Lendio, UT Five Star Painting, TX Real Property Management, UT Franchise Drivers Inc., TX Abrakadoodle, VA Glass Doctor, TX Archadeck, VA Gold's Gym International, TX Conserva Irrigation, VA iCode Franchise Inc., TX FIT20 USA, VA Ivy Kids Early Learning Center, TX Home Clean Heroes, VA Kwik Kopy, TX Kinderdance International Inc, VA Mr. Appliance, TX Mosquito Joe, VA Mr. Electric, TX Outdoor Lighting Perspectives, VA Mr. Rooter, TX Outdoor Living Brands, Inc., VA Neighborly, TX Ynot Italian, VA Rainbow International, TX Ben & Jerry's Franchising Inc., VT Salons by JC, TX EarthWise Pet, WA Sport Clips, TX Skyhawks Franchise Group, WA The Ground Guys, TX Culver's Franchising System, WI The Lash Lounge, TX Taco John's, WY The Woodhouse Day Spas, TX Myfrii Franchise Twin Peaks Restaurants, TX .